Fairmont to run St Andrews resort

7 June 2006

Fairmont Hotels & Resorts is pleased to announce that it has entered into an agreement to manage the St Andrews Bay Golf Resort & Spa in Scotland. Apollo European Real Estate Fund II, L.P. will purchase the resort from Ch‰teau Élan Hotels & Resorts, with financing from Bank of Scotland Corporate.

Fairmont will assume management of the 209-room resort on July 1, 2006 under a long-term management contract and the property will be reflagged early Fall 2006.

This latest acquisition expands Apollo’s European investments in the hospitality sector and the hotel company’s European presence, joining The Savoy, A Fairmont Hotel and the Fairmont Monte Carlo.

Located two miles from the town of St Andrews and the venerated Old Course, the resort features five dining outlets, a 3,500 square foot spa and health club and two 18-hole golf courses. Within a short drive of the resort are another 10 golf courses. Built in 2001, the property will be enhanced through a £10 million, multi-year refurbishment program. Renovations include guestrooms, public areas, meeting rooms and technology upgrades.

William R. Fatt, Fairmont’s Chief Executive Officer, said, “St Andrews is the acclaimed “home of golf” and we are pleased to not only expand our presence in Europe but also to increase our truly distinctive golf offerings through the addition of this resort. We recognize the current owners’ commitment to the property, and look forward to working with Apollo in enhancing the resort and building upon its success.”

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Johnny Robertson, Director of Apollo Real Estate Advisors in Europe, commented, “We are delighted to be acquiring St Andrews Bay Golf Resort & Spa, particularly as it is in one of the most important tourist locations in Scotland. This is the first time we have worked with Fairmont in Europe and we look forward to developing a long-term successful relationship with them on this and other opportunities in the future.”

Damian McGann, Head of Corporate at Bank of Scotland commented “We are delighted to be supporting two first rate partners, who we know well, in the next chapter of the highly successful St Andrews Bay story.”

Don Panoz, Founder of Ch‰teau Élan Hotels & Resorts said, “We look forward to St Andrews Bay realizing the major benefits from the financial strength, international links, global marketing capability and excellent reputation that the partnership of Apollo and Fairmont offers and are convinced the resort and its employees’ best interests will be well served by this transaction.”——-